Journal
SUSTAINABILITY
Volume 12, Issue 18, Pages -Publisher
MDPI
DOI: 10.3390/su12187442
Keywords
academic experience; corporate innovation; firm performance; incentives; state-owned enterprises
Funding
- National KeyR&DProgram of China [2017YFB1401800]
- National Natural Science Foundation of China (NSFC) [71774067]
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To date, the effect of the specific type of prior work experience of chief executive officers (CEOs) on innovation and firm performance remains poorly understood. Using upper perspective theory, this study argues that CEOs' academic work experience affects firms' innovation output, which in turn determines how research and development (R&D) activities affect firm performance. Analyzing a sample of 1210 Chinese publicly traded firms from 2013-2017, we found that firms with CEOs who were previously associated with universities or research institutions had better innovation output and performance than firms led by CEOs without such background. In addition, we found that former academics spent more on R&D investment, resulting in lower firm performance compared to firms that were not led by CEOs with an academic background. Furthermore, the innovation output was even higher, and performance was inversely reduced for ventures where state ownership is significant.
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